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At St. Jude, Firing Back at Critics

As St. Jude Medical defends itself against reports of deaths and injuries linked to problems with an implanted heart device, it finds itself in familiar territory. Since 2005, two competitors, Medtronic and Guidant, have faced similar scrutiny about critical flaws in their products.

But St. Jude is distinguishing itself with what doctors and others say is a rare response — a scorched-earth defense of its policies and products. The company’s chief executive, Daniel J. Starks, has led that charge, accusing Medtronic of trying to undercut St. Jude to gain business. He and other company executives have also gone after a prominent researcher, contending he made crucial errors and showed bias in a study critical of a St. Jude heart device component at the center of the safety issue.

Mr. Starks’s mode of attack, however, may be backfiring. On Tuesday, the medical journal that published the report challenged by St. Jude said it had rejected the company’s request to retract it. And interviews suggest that some of Mr. Starks’s comments are putting off some doctors essential to St. Jude’s success — specialists who implant heart devices.

“I don’t think he is helping his company,” said Dr. Laurence M. Epstein, a heart device expert in Boston who consults for Medtronic and St. Jude. “I think that any time you get defensive, it looks bad.”

On Wednesday, St. Jude shares climbed 70 cents to close at $39.23, but were still down more than 11 percent since March 30. The scope of the problem involving the component, a wire or lead that connects a defibrillator to a patient’s heart, is still unfolding. The lead, a model called the Riata, has been implanted in about 128,000 patients worldwide.

Electrical wires within the Riata lead are breaking through the insulation and causing unintended shocks in some patients. An even greater concern is that the wires may fail when needed to deliver a lifesaving jolt to restore a failing heart to normal beating.

The company stopped selling the Riata in late 2010. But the intensity of St. Jude’s response appears to reflect a high-stakes effort to protect its newer lead, the Durata, from any suggestion that it might be prone to the same problem.

The Durata has an added insulation sheath that St. Jude says should prevent the problem; thus far, it has a good safety record, but data is only a few years old.

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Daniel J. Starks, St. Jude Medical’s chief, is on the offensive.Credit
St. Jude Medical

It is little wonder, given the importance of the Durata to St. Jude’s future, that company officials would aggressively defend it. Still, Mr. Starks’s manner appears to run the risk of alienating physicians.

For example, in comments to Wall Street analysts in January, he described as a “nonevent” a recent meeting of leading device experts in Minneapolis who had gathered to better understand the safety problems posed by the Riata and how to address the lead’s risks in patients. Doctors are grappling with the issue of whether it is more dangerous to remove the lead if it is failing, or leave it in.

In his comments, Mr. Starks seemed to minimize the meeting’s value, describing it as “lightly attended.” He added that he also saw it as a sales opportunity for St. Jude, claiming that many doctors in attendance used competitors’ products. “From that perspective, it was a good meeting,” he said.

One expert who attended the meeting, Dr. Charles Swerdlow, said that St. Jude executives like Mr. Starks might better serve the company’s interests by focusing on patients and their safety. He and other doctors have complained that St. Jude was slow to respond to the Riata problem and initially tried to play it down.

“I hope that St. Jude is putting as much effort into helping patients with Riata leads as they are into pointing out flaws in studies that identified the failures,” said Dr. Swerdlow, who practices in Los Angeles. He consults primarily with Medtronic but has also worked with St. Jude.

Another expert, Dr. Anne Curtis, said she doubted Mr. Starks’s suggestion that the meeting was filled with physicians who did not use the company’s devices. However, Dr. Curtis, who serves on the St. Jude medical advisory board, said she thought the company had been open in dealing with the Riata issue.

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In a telephone interview Tuesday, Mr. Starks said his public comments were not intended to be strident but added that he felt it was critical for him to correct mistaken information about St. Jude’s products.

“It’s not our intent to put anybody off,” he said. “Anytime anybody is hurt by a medical device that we’ve manufactured, or anytime that there’s any issue with one of our medical devices, we hate it. We do take it very seriously.”

He also said that his remarks about the Minneapolis meeting reflected his view that the safety issues surrounding the Riata had already been addressed by a professional group representing heart device experts. But St. Jude officials may also have been mindful of another issue: in a poll taken of experts at the beginning of the Minneapolis gathering, two-thirds of those who responded said they would reduce the number of newer Durata leads they implanted or not use them for now.

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Dr. Laurence Epstein, a heart device expert who consults for St. Jude, said he thought the chief was doing the company no favors.Credit
Jodi Hilton for The New York Times

Mr. Starks, 57, has been chief executive of St. Jude since 2004 and previously served as president and chief operating officer of the company. He was paid $6.6 million in total compensation in 2011, according to company filings.

This is not the first time he and the company have taken a combative position: in 2009, St. Jude quit the industry trade group AdvaMed because Mr. Starks argued that the group’s stance on health care reform was placing some device makers like St. Jude at a disadvantage to others.

Some Wall Street analysts said Mr. Starks was acting appropriately in his recent comments, by addressing concerns about the Riata lead without overreacting and scaring investors in the process.

“I think Starks can come across as kind of ornery, but at the same time he has to be that way because he needs to show that he is confident,” said Mike Matson, an analyst for Mizuho Securities.

But another analyst described Mr. Starks’s actions as unprecedented. “I’ve never seen anything like it,” said Matthew Dodds, an analyst for Citigroup, who wrote a critical report Monday about St. Jude.

He said the company had sent him an e-mail contesting his report, then forwarded it to competing analysts. On Wall Street, he said, “people are still trying to digest this level of aggression.”

Mr. Starks and St. Jude, however, show no signs of backing off. On Tuesday, rather than react in a news release to the decision by the medical journal to deny its request to retract an article, St. Jude apparently shifted to Plan B.

It announced that it had posted data on the Internet intended to show that the researcher with whom it has clashed, Dr. Robert Hauser of Minneapolis, had made critical mistakes. In response, Dr. Hauser said he stood by his report and that the difference between his findings and St. Jude’s reflected methodological, rather than substantive, differences.

Some doctors said that they were tired of the sideshow, and that what they wanted from St. Jude was information about how to deal with patients who have disintegrating Riata leads.

“In order to know what to do you have to understand the statistics,” said Dr. Epstein in Boston. “We don’t know the risks with this lead.”

A version of this article appears in print on April 12, 2012, on Page B1 of the New York edition with the headline: At St. Jude, Firing Back At Critics. Order Reprints|Today's Paper|Subscribe